RealPage sues Berkeley officials over rental algorithm restrictions

In early 2025, RealPage, a Texas-based real estate software company, initiated a federal lawsuit against the city of Berkeley, California. The city's ordinance was designed to prevent landlords from utilizing algorithms for setting rents, citing concerns over anti-competitive practices driving up housing costs. This move followed a trend among various cities like San Francisco and Philadelphia, which have implemented similar restrictions. RealPage contended that the new law infringes upon its free speech rights and argued that the ordinance's claims regarding rising rents and evictions due to algorithmic pricing are misleading. The lawsuit highlighted statements from RealPage executives asserting their algorithms assist landlords in maximizing occupancy without engaging in price-fixing or collusion. According to the company, the real issue contributing to inflated housing prices is the insufficient supply of housing rather than the recommendations stemming from their software. RealPage further criticized the American Economic Liberties Project, an advocacy group opposing monopolistic behaviors, for allegedly spreading misinformation that prompted local governments to pursue such ordinances. Moreover, the Department of Justice had previously sued RealPage, claiming their algorithms allowed landlords to align pricing to avoid competition, which prosecutors regarded as a form of illegal collusion. Although the DOJ's lawsuit is still in progress, other lawsuits against RealPage from tenants and the attorneys general of Arizona and Washington, D.C. are also underway. Berkeley's ordinance includes penalties for violations, reflecting local officials' desire to address perceived injustices in the housing market caused by algorithmic influences. RealPage's representatives argued they were not provided an opportunity to discuss their stance before the ordinance was enacted, emphasizing the impact of market dynamics and the ongoing struggles around housing affordability. As the legal battle unfolds, the implications of algorithm-driven pricing in the real estate sector remain a contentious topic across various municipalities, pointing to a larger conflict between tech-driven solutions and local housing policy efforts.